HICL Update: Better Results, Less Discount

A quick update on UK listed HICL.L which is a current PYE holding and which I have written about a couple of times in the last 6-months.

After moving HICL into the penalty box following the failed TRIG .L merger proposal, todays annual results were strong enough to change the tone.

NAV/share rose to 160.2p, total NAV return was 10.3%, and dividend cash cover improved to 1.10x excluding disposals. That matters. The dividend is not just being held together by hope or asset sales.

Capital allocation also looked sensible: £536m of disposals, the A63 Motorway (a major US highway for US investors) sold at a 21% premium to carrying value, and £103m of buybacks added 1.6p to NAV/share.

The market noticed. Shares were up around 4%, which means the discount has already narrowed. At roughly 134p versus 160.2p NAV, the discount is now about 16%, not the 20%+ level that made the setup more obviously compelling. The FY27 dividend target of 8.50p gives a forward yield of about 6.3% at this price.

My stance: HICL.L is back on the watchlist as a possible add, but I am not chasing today’s move. The results are good. The dividend looks better covered. The discount is still meaningful. But I want to hear more at the July capital markets seminar before treating this as core ballast again.

Patience still wins.